DOCSLIB.ORG

Virtual Annual Meeting of Stockholders

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Virtual Annual Meeting of Stockholders Answers to Questions 2021 ANNUAL MEETING OF STOCKHOLDERS 1. HOW DO YOU SELECT MEMBERS OF YOUR BOARD, AND WHY DO YOU HAVE 15 DIRECTORS? The Committee on Directors’ Affairs regularly evaluates the size and composition of the Board and continually assesses whether the composition appropriately relates to ConocoPhillips’ strategic needs. These needs change as our business environment evolves. It’s important to note that the Board balances its commitment to maintaining institutional knowledge with the need for fresh perspectives that Board refreshment and director succession planning provide. As directors approach retirement age, the Committee seeks to bring in new directors to backfill the needed skills and experience of outgoing directors with enough overlap in service to allow for a smooth transfer of institutional knowledge and the sharing of experiences. As a general matter, it’s the sense of the Board that a director should not stand for re-election after his or her 72nd birthday. We anticipate two of our directors will not stand for re-election next year for this reason. The onboarding of new directors in advance of planned retirements is key to ensuring a successful transition. 2. WHAT ARE YOU DOING TO INCREASE THE NUMBER OF PEOPLE OF COLOR ON THE BOARD OF DIRECTORS? When conducting its review of the appropriate skills and qualifications desired of directors, the Committee on Directors’ Affairs considers diversity of age, skills, gender and ethnicity. A summary of each of our directors and their qualifications is available here and on pages 8-9 of our 2021 Proxy Statement. We are very committed to a diverse, inclusive and engaged Board of Directors. 3. WHERE DOES YOUR COMPANY STAND ON VOTING RIGHTS RESTRICTIONS? Voting is a democratic principle that equally values the voice of every citizen. For many Americans, gaining access to voting was a hard-fought right. All Americans who qualify should be able to exercise this right free from unnecessary hurdles. Ensuring equitable access for American voters and protecting the security and integrity of our election process is not a binary choice. We urge our elected leaders to work together to find a solution that achieves both. We encourage our employees to exercise their right to vote by allowing flexibility and paid time off to do so. 4. IS CONOCOPHILLIPS INVESTING IN THE GOAL TO ACHIEVE NET ZERO CARBON EMISSIONS BY 2050? IS THERE A FUTURE FOR CONOCOPHILLIPS IN A CARBON-NEUTRAL WORLD? We are committed to providing affordable natural gas and oil necessary to support global economic development while also lowering our greenhouse gas (GHG) emissions. In 2020 we announced a Paris- aligned climate risk strategy that sets an ambition to reduce our operational greenhouse gas (GHG) 1 Answers to Questions | 2021 ANNUAL MEETING OF STOCKHOLDERS emissions to net-zero by 2050. We also substantially revised our 2030 target to reduce our GHG emissions intensity, endorsed the World Bank Zero Routine Flaring by 2030 initiative and set a target to reduce methane emissions intensity. These targets inform internal climate goals at the business level and support innovation on efficiency and emissions reduction, GHG regulatory risk mitigation and climate-related risk management throughout the lifecycle of our assets. We use a marginal abatement cost curve (MACC) in our long-range planning to identify the most cost- effective emissions reduction opportunities available to the company globally. We are also using new technologies for methane emissions detection. Even in scenarios that meet a below 2-degree Celsius temperature rise target, fossil fuels will supply almost half of energy demand in 2050 (according to the International Energy Agency and others). The cost of supply of our resource base supports our assertion that resources with the lowest cost of supply are most likely to be developed in scenarios with lower demand, such as the IEA’s Sustainable Development Scenario. 5. WHAT IS CONOCOPHILLIPS DOING TO STAY RELEVANT WHEN OIL PRICES CONTINUE TO DECLINE AND WHAT ARE YOU DOING TO DIVERSIFY YOUR ENERGY SOURCES BEYOND NATURAL GAS AND OIL? Even in scenarios that meet a below 2-degree Celsius temperature rise target, fossil fuels will supply almost half of energy demand in 2050 (according to the International Energy Agency and others), which means our upstream industry will still play a vital role in meeting global energy demand. We have recently formed an internal low carbon team that is studying and evaluating various low carbon alternatives that are viable for our company, including investments to lower our own emissions and/or to diversify our business lines. Overall, to succeed in a low-carbon economy, we also recognize the need to play a constructive role in public policy dialogue to devise practical, equitable and cost-effective approaches to reduce GHG emissions and address the impacts of climate-related risks. As examples, we are advocates of a carbon tax and we are also members of the IEA Energy Pathways Collaboration, which is working with MIT to develop quantitative methods to develop national energy policies. 6. CAN YOU EXPLAIN WHY YOUR EXECUTIVE COMPENSATION CONTINUES TO BE SO HIGH? Our executive compensation philosophy links pay with performance. It is designed to reflect appropriate governance practices, align with the needs of our business, and maintain a strong link between executive pay and successful execution of our strategy. We were pleased with the results of the 2021 Say on Pay vote, which received support of over 92% of voting stockholders. We remain committed to ongoing dialogue with stockholders and other stakeholders to obtain their input on key matters. Our pay programs continually evolve to incorporate stockholder feedback, market best practices, and performance and retention considerations. It’s worth noting that as part of the extraordinary events of 2020, which included the simultaneous COVID- driven demand shock and OPEC driven supply shock, and our core belief that executive compensation should align the interest of executives with stockholders, the HRCC took a number of actions during the year to respond to the unprecedented impacts, including: 2 Answers to Questions | 2021 ANNUAL MEETING OF STOCKHOLDERS • Reducing base salaries or reversing 2020 salary adjustments for NEOs consistent with actions taken for employees globally to support our cost reduction efforts related to the COVID-19 pandemic; • Adjusting metrics and targets in the 2020 annual incentive program (the “VCIP”), to reflect adjusted corporate priorities and to align with external guidance and internal budgets; • Reviewing but making no changes to the performance metrics in the long-term incentive program PSP 18 (2018-2020); • Exercising negative discretion to reduce the 2020 VCIP payout below target and to reduce the PSP 18 payout, recognizing the overall stockholder experience during 2020; and • Making no individual adjustments for the NEOs for the 2020 VCIP, despite their significant contributions during this unprecedented time. 7. WILL THERE BE A DIVIDEND INCREASE IN THE NEAR FUTURE? ConocoPhillips has a long-stated commitment to return at least 30% of cash from operations to shareholders. This is something we have achieved through a combination of share buybacks and the dividend. A decision to increase the dividend is made by the Board, but a priority is to grow the dividend annually. Most recently, the dividend was increased in October of 2020. But the Board continues to review and evaluate the dividend as part of its overall strategy to return capital to stockholders. 8. HOW WOULD YOU SUMMARIZE THE STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS TO CONOCOPHILLIPS FOR 2021 AND BEYOND? The ConocoPhillips leadership team, in collaboration with the Board, evaluates our strategy on an ongoing basis, including as part of our enterprise risk management process. We believe that to achieve long-term success in this industry, an E&P company must have the lowest cost of supply resource base, the most capital efficient development plan, a robust balance sheet, strong financial performance, demonstrated ESG leadership and the best workforce in the industry. ConocoPhillips leads the pack on this and believes it is poised to respond to challenges from a position of strength, while also monitoring and responding – as appropriate – to the energy transition. 9. DOES CONOCOPHILLIPS INTEND TO ADDRESS FLARING OF GAS AT ITS WELLS? Setting a target to get to zero routine flaring by 2030, with an ambition to get there by 2025, is a key near-term action within our ambition to become a net-zero company by 2050. While our flaring emissions make up only 11% of our total GHG emissions, the target will drive continued near-term focus on routine flaring reductions across our assets. Flaring is a regulated and permitted process for the controlled release and burning of natural gas during oil and gas exploration, production and processing operations. Routine flaring is defined as flaring that occurs during the normal production of oil in the absence of sufficient facilities to utilize the gas onsite, dispatch it to a market or re-inject it. Flaring for safety reasons, non-routine flaring or flaring gas other than associated gas is not included as part of the World Bank Zero Routine Flaring initiative Note that the company’s flaring emissions over the last five years represent just 11% of the company’s regularly reported greenhouse gas emissions. Some ways we are already reducing our flaring is by 3 Answers to Questions | 2021 ANNUAL MEETING OF STOCKHOLDERS working with our midstream partners to increase processing capacity and provide forecasts to improve their ability to plan. In the Permian, we have built and operate our own gathering system, which enables more flexibility and connections to multiple third-party processors. We have also developed and implemented facility design changes to reduce (or eliminate) flaring from tanks, and we utilize an internal decision tree to optimize our operations to reduce flaring during third party outages.
Load more

Recommended publications
  • Price Forecast June 30, 2015 Contents
    Resource Evaluation & Advisory Price forecast June 30, 2015 Contents Canadian price forecast 1 International price forecast 5 Global outlook 6 Western Canada royalty comparison 8 Pricing philosophy 11 Glossary 12 Canadian domestic price forecast Forecast commentary Andrew Botterill Senior Manager, Resource Evaluation & Advisory “Everything is in a state of fl ux, including status quo” - Robert Byrne As industry adjusts to the “new normal” we have analyzed This narrowing has been most notable on the heavy oil in our last two forecasts, activities in the energy sector side, where diff erentials have decreased more than 30 per are beginning to demonstrate a cautious, but optimistic cent compared with where they were in summer 2014. view of the future. While not anticipating $100 oil in the With greater than 60 per cent of Canadian production near term, these views show an expectation industry will being from oil sands (CAPP 2015 forecast report) the bring a more focused approach to North American oil narrowing of heavy diff erentials is welcome news to much development within the coming 12 to 18 months. of the sector. In recent weeks, the WTI to heavy diff erential has been narrower than we have seen recently as In recent weeks, Canadian-received oil prices have been production from some projects was shut-in due to wildfi res stronger relative to the beginning of the year, with daily in northern Alberta. The shut-in production has since been WTI settlements hovering around $60/bbl USD and brought back on-stream, which has slowed the narrowing Canadian Light settlements greater than $70/bbl CAD.
    [Show full text]
  • The Price of Oil Risk
    The Price of Oil Risk Steven D. Baker,∗ Bryan R. Routledge,y [February 10, 2017] Abstract We solve a Pareto risk-sharing problem for two agents with heterogeneous re- cursive utility over two goods: oil, and a general consumption good. Using the optimal consumption allocation, we derive a pricing kernel and the price of oil and related futures contracts. This gives us insight into the dynamics of prices and risk premia. We compute portfolios that implement the optimal consumption policies, and demonstrate that large and variable open interest is a property of optimal risk-sharing. A numerical example of our model shows that rising open interest and falling oil risk premium are an outcome of the dynamic properties of the optimal risk sharing solution. ∗ McIntire School of Commerce, University of Virginia; [email protected]. y Tepper School of Business, Carnegie Mellon University; [email protected]. 1 Introduction The spot price of crude oil, and commodities in general, experienced a dramatic price increase in the summer of 2008. For oil, the spot price peaked in early July 2008 at $145.31 per barrel (see Figure 1). In real-terms, this price spike exceeded both of the OPEC price shocks of 1970's and has lasted much longer than the price spike at the time of the Iraq invasion of Kuwait in the summer of 1990. The run-up to the July 2008 price of oil begins around 2004. Buyuksahin, Haigh, Harris, Overdahl, and Robe (2011) and Hamilton and Wu (2014) identify a structural change in the behavior of oil prices around 2004.
    [Show full text]
  • The Impact of the U.S Fracking Boom on the Price of Oil and on Arab Oil Producers
    The Impact of the U.S Fracking Boom on the Price of Oil and on Arab Oil Producers Lutz Kilian University of Michigan CEPR Background ● Shale oil production became possible because of technological innovation (horizontal drilling, hydraulic fracturing (fracking), microseismic imaging). ● The rapid expansion of U.S. shale oil production was stimulated by the high price of conventional crude oil after 2003, which made this new technology competitive. ● Since then efficiency gains in shale oil production have lowered its cost, allowing continued production at much lower oil prices. ● Because the price of oil has remained low since 2015, shale oil producers are experiencing increased operating losses and financial stress. The Role of Refineries ● Crude oil is being consumed by refineries that turn crude oil into refined products such as gasoline, diesel, heating oil, jet fuel and heavy fuel oil. ● Not all refineries are alike. Their technical configuration determines which type of crude oil they can process. ● Changing an existing configuration is costly. The Refining Industry in Transition A few years ago, the global refining industry expected a growing shortage of light sweet crude oil worldwide: 1. Refiners along the Texas Gulf Coast invested in new technology that allowed them to become the world leader in processing heavier crudes. This allowed them to process lower priced crudes imported from Saudi Arabia, Venezuela and Mexico. 2. Refiners along the East Coast began to shut down existing refineries for light sweet crude oil in anticipation of a growing shortage of light sweet crude oil. The Glut That No One Saw Coming After 2010 shale oil was shipped in ever increasing quantities from the interior of the country to the U.S.
    [Show full text]
  • The Impact of the Decline in Oil Prices on the Economics, Politics and Oil Industry of Venezuela
    THE IMPACT OF THE DECLINE IN OIL PRICES ON THE ECONOMICS, POLITICS AND OIL INDUSTRY OF VENEZUELA By Francisco Monaldi SEPTEMBER 2015 B | CHAPTER NAME ABOUT THE CENTER ON GLOBAL ENERGY POLICY The Center on Global Energy Policy provides independent, balanced, data-driven analysis to help policymakers navigate the complex world of energy. We approach energy as an economic, security, and environmental concern. And we draw on the resources of a world-class institution, faculty with real-world experience, and a location in the world’s finance and media capital. Visit us atenergypolicy. columbia.edu facebook.com/ColumbiaUEnergy twitter.com/ColumbiaUEnergy ABOUT THE SCHOOL OF INTERNATIONAL AND PUBLIC AFFAIRS SIPA’s mission is to empower people to serve the global public interest. Our goal is to foster economic growth, sustainable development, social progress, and democratic governance by educating public policy professionals, producing policy-related research, and conveying the results to the world. Based in New York City, with a student body that is 50 percent international and educational partners in cities around the world, SIPA is the most global of public policy schools. For more information, please visit www.sipa.columbia.edu THE IMPACT OF THE DECLINE IN OIL PRICES ON THE ECONOMICS, POLITICS AND OIL INDUSTRY OF VENEZUELA By Francisco Monaldi* SEPTEMBER 2015 *Francisco Monaldi is Baker Institute Fellow in Latin American Energy Policy and Adjunct Professor of Energy Economics at Rice University, Belfer Center Associate in Geopolitics of Energy at the Harvard Kennedy School, Professor at the Instituto de Estudios Superiores de Administracion (IESA) in Caracas, Venezuela, and Founding Director of IESA’s Center on Energy and the Environment.
    [Show full text]
  • Global Dynamics of Oil Price Fluctuations
    RUCHAN KAYA MESUT HAKKI CASIN 146146 147 CASPIAN REPORT, SPRING 2015 GLOBAL DYNAMICS OF OIL PRICE FLUCTUATIONS RUCHAN KAYA SENIOR RESARCH FELLOW, ENERGY AND INTERNATIONAL RELATIONS EXPERT, HASEN The crude oil saw the lowest price levels since 2009 and has a few economic and political reasons behind the drop. The dramatic increase in the supply side is one of the main factors. Within the past year or so, only one around $55-60 levels and are cur- thing is certain about the oil prices rently hovering around $65. Look- and that is the uncertainty of the fu- ing at these numbers and future es- ture price levels. In June 2014, the timates, clearly, we cannot predict end of the year price predictions of the price of oil perfectly, but we can Barclay’s was $109 per barrel. How- identify the reasons of current trend ever, by that time, in January, the of decline, therefore lowering the MESUT HAKKI CASIN price was around $50 per barrel. amount of uncertainty in future esti- In early 2015 Goldman Sachs and mations and policy behavior. 146 147 Bank of America Merrill Lynch made even more worrisome price esti- CASPIAN REPORT, SPRING 2015 mates down around $35-45 range is that it is important to be aware of Onethe fact of the that first history things of oilto alreadyrecognize in- early March, the oil prices oscillated cludes such price booms and busts. in their Q1 projections. However, in Figure 1. Crude Oil Prices in 1861-2013 ($) Source: BP Statistical Review of World Energy, 2014 As Figure 1 shows, recent low prices than doubled the crude oil price, ris- of oil are nothing new as sharp de- ing from $14 per barrel to over $30 clines have existed in the past.
    [Show full text]
  • The Economic Impact of Oil Prices by Rurik Krymm
    The Economic Impact of Oil Prices by Rurik Krymm During the last three months of 1973, the tax-paid costs of typical grades of crude petroleum in the main producing areas of the world, around the Persian Gulf, were roughly quadrupled, rising for typical Iranian and Arabian Ugh t crudes from about $1.85 per barrel in September 1973 to more than $7.00 by 1 January 1974, or from approximately $13.30 to more than $50.00per ton. Since the cost of production represents an insignificantly small fraction of the new cost level (less than 2%) and subject to complex adjustments reflecting varying qualities of crude oils and advantages of geographical location, the producing countries may expect to receive a minimum average revenue of $50.00 per ton of crude oil produced on their territory instead of $12.50. If we ignore the purchases which carried the prices of relatively small amounts of oil to the $100-$ 150range, this figure of $50.00per ton with future adjustments for inflation represents a probable guide line for future cost estimates. The change affects exports of close to 1.4 billion tons of oil and consequently involves an immediate shift of financial resources of close to 60 billion dollars per year from the oil-consuming to the oil-producing countries. Tables 1, 2 and 3 give an idea of the distribution of this burden by main geographical regions and of its possible evolution over the next seven years. The figures involved are so large that comparisons have been made by some authors with the reparations proposals advanced by the Allies at the end of the First World War.
    [Show full text]
  • The 1973 Oil Crisis by Sarah Horton
    The 1973 Oil Crisis By Sarah Horton In October of 1973 Middle-eastern OPEC nations stopped exports to the US and other western nations. They meant to punish the western nations that supported Israel, their foe, in the Yom Kippur War, but they also realized the strong influence that they had on the world through oil. One of the many results of the embargo was higher oil prices all throughout the western world, particularly in America. The embargo forced America to consider many things about energy, such as the cost and supply, which up to 1973 no one had worried about (Spiegelman). In order to understand the main cause of the oil crisis one must first know the history of the region and the Arab- Israeli conflict. World War II a Zionist state, known as Israel, was created on 56% of the land that was formerly known as Palestine. This state served as a homeland for Jews. The local Arabs were enraged by the fact that the Palestinian land had been taken to create this state. They refused to acknowledge Israel as an independent state. The Arabs began to launch efforts to recapture the land that they felt was rightfully theirs. This created the Suez-Sinai War. The British and the French sided with the Israelis in order to punish Nasser for nationalizing the Suez Canal. The strong Israeli military forces quickly defeated the Arabs. The Arabs responded to this defeat by uniting. In 1967 Israel launched the Six-Day War, claiming much land. In 1973 Arab forces retaliated. On Yom Kippur, the holiest Jewish holiday, Arab forces attacked, backed by Soviet technology (The Mid-east Oil Crisis).
    [Show full text]
  • Dynamic Characteristics of Crude Oil Price Fluctuation—From the Perspective of Crude Oil Price Influence Mechanism
    energies Article Dynamic Characteristics of Crude Oil Price Fluctuation—From the Perspective of Crude Oil Price Influence Mechanism Jiaying Peng 1 , Zhenghui Li 2,* and Benjamin M. Drakeford 3 1 School of Economics, Hunan Agricultural University, Changsha 410128, China; [email protected] 2 Guangzhou International Institute of Finance and Guangzhou University, Guangzhou 510006, China 3 Economics and Finance Subject Group, Portsmouth Business School, University of Portsmouth, Portsmouth PO1 3AH, UK; [email protected] * Correspondence: [email protected] Received: 14 July 2020; Accepted: 27 August 2020; Published: 29 August 2020 Abstract: The uncertainty in the evolution of crude oil price fluctuation has a significant impact on economic stability. Based on the decomposition of crude oil price fluctuation by the state-space model, this paper studies the fluctuation trend of crude oil prices and its causes. The nonlinearity autoregressive distribute lag approach (NARDL) model is used to capture the influence mechanism characteristics of crude oil prices at different positions and different fluctuation trends. An event study model with dummy variables is constructed to compare the effects of different types of events on crude oil price fluctuations. The empirical results indicate that the fluctuation of crude oil prices tends to strengthen on the whole, and there is a remarkable correlation between this trend and the influencing mechanism of crude oil price, namely, the fluctuation source structure. The influence mechanism of crude oil price fluctuation is asymmetric when the crude oil price is at different positions and under different trends. There is a strong correlation between event shocks and event types in the evolution of crude oil price fluctuation.
    [Show full text]
  • What Does the Carbon Tax Mean for the Canadian Oil Sands?
    SPECIAL REPORT TD Economics November 22, 2016 WHAT DOES THE CARBON TAX MEAN FOR THE CANADIAN OIL SANDS? Highlights • The Canadian oil sands have long been criticized for their large carbon foot print. The Alberta govern- ment’s climate change plan will limit emissions in the sector and put a price on carbon, set to begin in January 2017. Details of the plan that have been released suggest that cleaner producers will be better off, at the expense of those with higher carbon intensities. • In October, the federal government introduced a national carbon-pricing plan, set to come into effect in 2018, with a higher price tag post-2020 than under the provincial plan. Few details are known and the impact will depend on how the province chooses to incorporate the federal tax. • However, we estimate that if oil prices are above roughly US$60 per barrel, the carbon price is unlikely to make or break a new investment decision. Below that threshold, the analysis becomes murky, as the carbon price wouldn’t be the only factor deterring new investment – greater advances in productivity and cost reduction would likely be required in order to make new projects economical. • All told, the price of oil, combined with other factors such as market access, will be the key determi- nants of new investment in oil sands projects over the medium-to-longer term. Canada’s oil sands have long been criticized for their large carbon footprint. There has been a lot of talk in recent years surrounding the fight against climate change, but little in the way of a comprehensive strategy.
    [Show full text]
  • Impact of U.S. Shale Oil Revolution on the Global Oil Market, the Price of Oil & Peak Oil by Mamdouh G
    International Association for Energy Economics | 27 Impact of U.S. Shale Oil Revolution on the Global Oil Market, the Price of Oil & Peak Oil By Mamdouh G. Salameh* Introduction Much has been written about the United States shale oil revolution. Some sources like the Internation- al Energy Agency (IEA) went as far as to predict that the United States will overtake Saudi Arabia and Russia to become the world’s biggest oil producer by 2020 and energy self-sufficient by 2030.1 Others called it a game changer with a new emerging balance of power in the global oil market. Yet others were in such a state of euphoria about the success of American shale oil production to say that it may deny OPEC the power to set global oil prices and that the world oil industry won’t be the same in the wake of shale. Some also claimed that the idea of peak oil had gone in flames. The above claims aside, given recent increases in U.S. shale oil and gas production, it is now clear that these resources might play some role in non-OPEC supply prospects. However, it begs the questions: what is the potential contribution of shale oil to future global oil sup- ply? Will the high development costs, and environmental impacts and challenges affect this potential? And will it be possible to replicate the U.S. success story globally? U.S. shale oil production is projected to increase from about 1 million barrels a day (mbd) in 2012 to 2 mbd in 2020 possibly reaching 3 mbd by 2025.2 However, this increase would hardly offset the normal annual depletion rate of 3%-5% in U.S.
    [Show full text]
  • U.S. Trade Deficit and the Impact of Changing Oil Prices
    U.S. Trade Deficit and the Impact of Changing Oil Prices Updated February 24, 2020 Congressional Research Service https://crsreports.congress.gov RS22204 SUMMARY RS22204 U.S. Trade Deficit and the Impact of February 24, 2020 Changing Oil Prices James K. Jackson Exports and imports of petroleum products and changes in their prices have long had a large Specialist in International impact on the U.S. balance of payments, often serving as a major component in the U.S. trade Trade and Finance deficit. Over the past decade, however, this has changed. Currently, petroleum prices are having less of an impact on the U.S. balance of payments primarily due to the growth in U.S. exports of petroleum products; in the last four months of 2019, U.S. exports of petroleum products exceeded imports. While this represents a major step in achieving energy independence, the United States remains a major net importer of crude oil and questions remain about the sustainability of some U.S. energy exports. The share of petroleum products in the overall U.S. trade deficit has fallen from around 47% in December 2010 to -0.1 in December 2019. Recently, imported petroleum prices fell from an average of $58.86 per barrel of crude oil in 2018 to an average price of $53.31 per barrel in 2019, or a decline of 8.4%. Average prices rose to $60.00 per barrel in May 2019, following the annual trend of rising energy prices heading into the summer months, before declining in the fall and winter.
    [Show full text]
  • The U. S. Fracking Boom: Impacts on Global Oil Prices and OPEC
    IAEE Energy Forum Second Quarter 2018 The U. S. Fracking Boom: Impacts on Global Oil Prices and OPEC By Manuel Frondel, Marco Horvath, Colin Vance After a steady decline spanning several decades, U.S. crude oil production rebounded in 2008 owing to the increased adoption of hydraulic fracturing, a technology otherwise known The authors are with RWI Leibniz Institute as fracking. In conjunction with horizontal drilling and micro-seismic imaging, the use of this for Economic Reserach, technology, originally developed for the exploration of natural gas, allows for tapping into Germany, and can be oil reservoirs that are trapped in shale siltstone and clay stone formations (Maugeri, 2012). reached at: frondel@ Hence, oil extracted on the basis of fracking techniques is commonly referred to as shale oil rwi-essen.de, horvath@ to differentiate it from crude oil obtained by conventional drilling methods. rwi-essen.de, and To date, the only country that permits fracking on a large scale is the U.S. (Kilian, 2017). [email protected]. Many other countries are highly reluctant to employ this technology because of its potentially Financial support by Fritz negative implications for the environment, notably hazards that may arise from water pollution Thyssen and Commerz- and seismic tremors (Jackson et al., 2014). With the beginning of the surge in shale oil produc- bank Foundation is grate- fully acknowledged. tion in late 2008 (Kilian, 2017), U.S. crude oil production steadily increased until the end of 2014, with the share of shale oil in total U.S. production rising from about 6% in January 2000 See footnote at end of text.
    [Show full text]